Method and apparatus for conducting a transaction

ABSTRACT

Systems, methods, apparatus, computer program code and means for conducting a transaction are provided. In some embodiments, a unit is issued to a holder including a forward contract and a note, in which the note specifies an initial capped remarketing, at least a first subsequent capped remarketing, and an uncapped remarketing, the uncapped remarketing performed only if each of the capped remarketings fail.

CROSS REFERENCE TO RELATED APPLICATIONS

This application claims priority to, and hereby incorporates byreference for all purposes, U.S. Provisional Application Ser. Nos.60/493,558, and 60/493,187, filed Aug. 5, 2003 and Aug. 7, 2003respectively. This application is related to co-pending and commonlyassigned U.S. patent application Ser. No. 10/707,491, filed Dec. 17,2003, the contents of which is incorporated herein by reference for allpurposes.

BACKGROUND

The present invention relates to methods and apparatus for conductingtransactions. More particularly, embodiments of the present inventionrelate to methods and apparatus for conducting transactions involvingmandatory units.

Mandatory units are hybrid financial products involving the issuance ofa stock purchase contract together with a debt instrument. Theseproducts were first introduced in the mid to late-1990's, and havebecome popular products providing benefits to both issuers andinvestors. Mandatory units provide a number of benefits to both thecompany issuing the unit as well as investors in the mandatory units.They may be used by issuers to implement more efficient financings thathave desirable financial benefits that may not be achieved by straightdebt or equity issuances.

Examples of hybrid products that provide desirable financial benefits toboth issuers and investors include the hybrid described in ourco-pending, commonly assigned, U.S. patent application Ser. No.10/707,491, as well as the “ACES” mandatory units offered by theassignee of the present invention. A wide variety of other mandatoryunits are provided by other entities.

Many of these hybrids provide desirable financial benefits, includingdesirable tax treatment, when appropriately structured. In the U.S., forexample, the Internal Revenue Service (“IRS”) has confirmed in itsRevenue Ruling 2003-97 that the interest on the debt portion of amandatory unit is deductible if the purchase contract portion of theunit terminates in bankruptcy and if, on the issue date of the unit, itis substantially certain that a remarketing of the debt portion willsucceed (it is not substantially certain if the reset rate is capped).That is, an issuer will enjoy interest deductions if the unit isstructured such that the reset rate is not capped.

Unfortunately, this is at odds with regulatory requirements imposed oncertain types of entities, limiting their ability to issue mandatoryunits. For example, in many countries, certain types of financialinstitutions must comply with rules and regulations imposing capitaladequacy standards. In the U.S., for example, most financialinstitutions must comply with the Bank Holding Company Act of 1956 (12U.S.C. § 1841 et seq.). The capital adequacy standards required by theBank Holding Company Act are generally implemented by rules promulgated(or enforced) by the U.S. Federal Reserve which has adopted risk-basedcapital measures used to assess the capital adequacy of regulatedbanking organizations. Similar risk-based capital measures are used inother countries.

These capital measures generally group capital into several categories:(1) “Tier 1” or “core” capital; and (2) “Tier 2” or “supplementary”capital. The capital measures generally require that the Tier 1component of an institution's qualifying capital represent at least 50%of the institution's total capital, and generally includes freelyavailable equity of the institution such as common stockholder equity,preferred stock and interests in the equity accounts of consolidatedsubsidiaries.

The capital measures generally require that the Tier 2 component mayrepresent up to 100% of the Tier 1 component, and may include a numberof different types of capital, such as allowances for loan and leaselosses, perpetual preferred stock and related surplus, hybrid capitalinstruments, perpetual debt, and mandatory convertible debt securities.That is, hybrid instruments such as mandatory convertible debtsecurities, are considered Tier 2 capital. Regulated institutions alsomay need to comply with certain adequacy ratios that specify therelative amounts of Tier 1 and Tier 2 capital the institution canmaintain at any given time. In general, regulated institutions prefer toincrease the amount of Tier 1 capital. One reason that mandatory unitsare considered Tier 2 capital is that they typically have uncapped resetrates (pursuant to the IRS rules discussed above).

SUMMARY

To alleviate the problems inherent in the prior art, embodiments of thepresent invention provide systems, methods, apparatus, computer programcode and means for issuing a unit to a holder include creating a forwardcontract, the forward contract specifying a settlement amount and asettlement date; creating a note securing obligations of the holderunder the forward contract, the note specifying an initial cappedremarketing, at least a first subsequent capped remarketing, and anuncapped remarketing, the uncapped remarketing performed only if each ofthe capped remarketings fail, each of the capped and uncappedremarketings scheduled to occur prior to the settlement date; andissuing the forward contract and the note as a unit.

Some embodiments provide a system, method, apparatus, computer programcode and means for remarketing a mandatory unit which include attemptingan initial capped remarketing of a note portion of the mandatory unit,the initial remarketing attempted prior to a settlement date of aforward contract portion of the mandatory unit, the initial remarketingsubject to a reset rate cap; attempting a subsequent capped remarketingif the initial remarketing is unsuccessful; and attempting, if both theinitial capped remarketing and the subsequent capped remarketings areunsuccessful, a final remarketing of the note portion of the mandatoryunit, the final remarketing attempted prior to the settlement date andnot subject to a reset rate cap.

Pursuant to some embodiments, an opportunistic remarketing is attemptedduring an opportunistic remarketing period. The opportunisticremarketing is at the issuer's option and may be capped or uncapped. Insome embodiments, the forward contract portion is settled with proceedsfrom a successful remarketing. In some embodiments, a remarketing issuccessful if the note can be resold for an amount greater than asettlement price associated with the forward contract.

With these and other advantages and features of the invention that willbecome hereinafter apparent, the nature of the invention may be moreclearly understood by reference to the following detailed description ofthe invention, the appended claims and to the several drawings attachedherein.

BRIEF DESCRIPTION OF THE DRAWINGS

FIG. 1 is a block diagram of a transaction consistent with someembodiments.

FIG. 2 is a flow diagram illustrating an exemplary process for issuing aunit pursuant to some embodiments.

FIG. 3 is a block diagram of a unit administrator device pursuant tosome embodiments.

DETAILED DESCRIPTION

According to some embodiments, systems, methods, apparatus, computerprogram code, and means are provided for conducting a transaction. Moreparticularly, some embodiments relate to transactions in mandatory unitssuch that the transaction qualifies for treatment as Tier 1 capital. Inthis manner, regulated institutions may enjoy the benefits of issuingmandatory units. As used herein, the terms “Tier 1 issuer” or “regulatedissuer” are generally used to refer to entities (typically financialinstitutions) that are subject to capital adequacy rules or regulationsin one or more jurisdictions. For example, in the U.S., many financialinstitutions are regulated under the Bank Holding Company Act thatimposes capital adequacy rules intended to strengthen the soundness andstability of the international banking system. As used herein, a “Tier 1issuer” or “regulated issuer” is a financial institution regulated inthe U.S. or in other jurisdictions. In particular, a “Tier 1 issuer” or“regulated issuer” is a financial institution subject to regulatorycapital requirements relating to the amount of Tier 1 and Tier 2 capitalthe issuer may maintain.

For convenience, as used herein, the term “note” as used in conjunctionwith embodiments described herein, is used to refer to a variety ofdifferent instruments, including, for example, straight debt,convertible debt, preferred stock, convertible preferred stock, trustpreferred, and convertible trust preferred.

Applicants have developed a mandatory unit structure that ensures that aremarketing will, eventually, likely be successful (thereby ensuringthat interest on the note portion is deductible) and which also includesan ability to substantially control or cap the reset rate at which theremarketing will occur (thereby allowing Tier 1 capital treatment).While further details of some embodiments will be provided below, ingeneral, embodiments involve units that are issued having a number ofscheduled remarketings (some of which are capped; some of which areuncapped). In some embodiments, units may further include one or morewindows during which the issuer of the unit can attempt opportunisticremarketings (capped or uncapped). In general, Applicants believe thatthis results in a unit structure that ensures that the remarketing willlikely be successful while providing substantial control over the resetrate.

Features of embodiments will be described by first referring to FIG. 1,where a block diagram depicts a transaction 100 consistent with someembodiments. As shown, transaction 100 may involve several entities orindividuals: an issuer 102, a holder 104 and (in some embodiments) oneor more agents 106. In particular, transaction 100 involves the issuanceof a unit 108 to holder 104, where unit 108 consists of a forwardcontract 112 and a note 110.

Pursuant to embodiments of the present invention, issuer 102 is a “Tier1” issuer (that is, an issuer subject to capital adequacy rules orregulations). For example, issuer 102 may desire to raise capitalthrough the issuance of a unit. In some embodiments, issuer 102 issues aunit directly to third parties. In some embodiments, a third partyintermediary (such as one or more agents 106) may participate in theissuance of unit 108 to third parties. For example, agents 106 may beone or more underwriters, support companies, trustees, or the like (someof which will be discussed further below, some of which will be apparentto those skilled in the art).

In some embodiments, holder 104 may be, for example, an individual orentity desiring to invest in debt and equity securities associated withissuer 102. For example, in some embodiments, holder 104 may be aninstitutional investor such as a qualified institutional buyer.

Pursuant to some embodiments, unit 108 includes a forward contract 112that includes terms obligating holder 104 to pay an amount (the“settlement price”) to issuer 102 at a particular date (the “settlementdate”) in exchange for a number of shares of stock of issuer 102. Inparticular, holder 104 is to receive an amount of stock of issuer 102that initially (e.g., as of the “issue date” of the unit) has a valueequal to the settlement price. In some embodiments, the stock is commonstock of issuer 102. In some embodiments, issuer 102 is required to paya contract fee to holder 104 in exchange for the holder's obligation topay the settlement price at the settlement date. For example, thecontract fee may be calculated as a percentage of the settlement amount.The fee may be paid quarterly or in other installments. In someembodiments, the settlement date is a date three (3) or four (4) yearsafter the issue date of the unit (and, as will be described furtherbelow, is selected to have a shorter term than the term of note 110).

Unit 108 includes a note 110 that is pledged to secure the holder'sobligations to pay the settlement price under forward contract 112. Insome embodiments (e.g., as discussed in our co-pending application Ser.No. 10/707,491), note 110 is a convertible note (and, in someembodiments, is a contingent convertible note). In some embodiments,note 110 is another form of debt instrument provided to secure theobligations under the forward contract 112. As discussed above, othertypes of instruments may also be used to secure the holder's obligationsunder forward contract 112.

Pursuant to some embodiments, note 110 specifies several types ofremarketings and several remarketing dates which are selected andstructured as described below in conjunction with FIG. 3. In general,pursuant to some embodiments, note 110 includes terms specifying severalscheduled remarketings which are “capped” (that is, the initialremarketings may be structured such that they have a reset rate which iscapped). If the first of the scheduled capped remarketings is notsuccessful, a second (and then a third, for example) are attemptedwithin a relatively short period of time (e.g., each capped remarketingmay be attempted several months after the last failed cappedremarketing). A scheduled uncapped remarketing is scheduled and isperformed if each of the capped remarketings fails.

In some embodiments, the issuer may also be provided a right to attemptan “opportunistic” remarketing during some period if each of thescheduled capped remarketings fail. For example, the opportunisticremarketing period may be scheduled to occur prior to the scheduleduncapped remarketing. In embodiments utilizing opportunisticremarketings, if the opportunistic remarketing fails (or is notattempted by the issuer), the scheduled uncapped remarketing isperformed.

In this manner, (whether or not the optional “opportunistic” remarketingis used) it is highly likely that a remarketing will be successful. Itis also likely that the remarketing will be successful in one of thecapped remarketings, thereby ensuring that the reset rate is controlled.Other reset and remarketing provisions and techniques may also be usedin conjunction with embodiments disclosed herein.

Referring now to FIG. 2, a process 200 is shown for issuing a unit to aholder pursuant to embodiments of the present invention. Each of theprocess blocks of the flow diagram of FIG. 2 (and other processesdiscussed herein) may be performed in any reasonable order and need notbe performed in the sequence shown. In some embodiments, some or all ofthe processing of transaction process 200 may be performed using one ormore computing devices configured to perform the processing describedherein. For example, as will be described in further detail below, someor all of the processing may be performed using a unit administratordevice 400 such as the device depicted in FIG. 4.

Pursuant to some embodiments, a process 200 for issuing a unit to aholder includes identifying (at 202) terms of a forward contractinvolving an issuer, a holder and an equity security. For example, termsof the forward contract may include terms specifying a settlement date,a settlement price, and a share delivery formula for calculating a sharedelivery of issuer stock to the holder at the settlement date.

Processing continues at 204 where terms of a note involving the issuerand the holder are identified. A number of different types of notes maybe issued as a unit with the forward contract, each of which may beselected to provide desired financial benefits. In general, the terms ofthe note will include terms identifying a maturity of the note, aninterest rate associated with the note, acceptable substitute collateralthat may be pledged by the holder to separate the contract from thenote, and other terms known to those skilled in the art. Pursuant toembodiments of the present invention, note also includes termsspecifying several remarketing events, including one or more cappedremarketings, an opportunistic remarketing period, and an uncappedremarketing.

The initial remarketing is a capped remarketing; that is, the initialremarketing is specified as having a rate that cannot exceed a specifiedrate. If any of the remarketings are successful, the proceeds are usedto immediately settle forward contract 112. For example, in someembodiments, the initial remarketing is capped at a readilyascertainable market rate associated with an instrument having acomparable maturity as the note. In some embodiments, the remarketingmust generate sufficient proceeds to settle forward contract 112 andalso to compensate a remarketing agent. For example, note 110 mayspecify that the remarketing must reset (if at all) so that note 110 canbe remarketed for at least 100.5% of the settlement price using U.S.Treasury securities that will mature at the settlement price (where theadditional 0.5% is provided to compensate the remarketing agent). Thoseskilled in the art will appreciate that other fee structures may also beprovided (e.g., a fee of 0.25% may be provided instead of 0.50%, etc.).

In some embodiments, the remarketings may be scheduled to occur suchthat the proceeds may be used to purchase Treasury securities (e.g., theproceeds may not be used to immediately settle forward contract 112, butinstead may be used to purchase Treasury securities or the like prior tosettling).

In some embodiments, a set of additional capped remarketings arescheduled. For example, in one embodiment, a set of two (2) or three (3)capped remarketings are scheduled to occur if the initial remarketingfails. These additional capped remarketings may be scheduled to occur ina particular sequence. For example, if the forward contract is a four(4) year contract, and the initial remarketing was scheduled to occuraround the time of the settlement of the forward contract, theadditional capped remarketings may be scheduled to occur before thesettlement date. As a specific example, three (3) additional cappedremarketings maybe scheduled to occur at year 3.25, year 3.5, and year3.75. For each of these scheduled additional capped remarketings, therate may be reset so long as it is below a set cap. Again, the cap maybe specified based on comparable instruments.

In some embodiments, note 110 may optionally include terms specifying aperiod in which issuer 104 may attempt (at its option) one or moreopportunistic remarketings (which may be capped or uncapped as desiredby the issuer). In some embodiments, this opportunistic remarketingperiod is set to occur during a period beginning after failure of theinitial capped remarketing, and extending until a final uncappedremarketing is scheduled. This final uncapped remarketing may bescheduled to occur after the last of the scheduled capped remarketings.In this manner, if each of the scheduled capped remarketings fails, theissuer will have the ability to attempt one or more opportunisticremarketings prior to performance of a scheduled uncapped remarketing.

Issuance of unit 108 is completed at 206 where the forward contract 112and the note 110 are issued as a unit to the holder 104. Pursuant toembodiments of the present invention, because it is likely that aremarketing of the note will succeed, and because it is likely that theremarketing will succeed with a capped reset rate, it is expected thatthe unit may be issued by regulated entities as Tier 1 capital.

Reference is now made to FIG. 3, where a process 300 is shown forremarketing a unit issued pursuant to embodiments of the presentinvention. Some, or all, of the process steps of process 300 may beperformed to perform a remarketing of a unit issued pursuant toembodiments of the present invention. The timing of the performance ofprocess 300 depends on the terms and conditions of each unit.

For example, to illustrate features of embodiments, process 300 will bedescribed by referring to a particular unit which issued having thefollowing terms (among others). The unit was issued on Feb. 15, 2001 andincludes a forward contract having a settlement date of Feb. 15, 2004and a settlement amount of $1,000. The forward contract is secured by anote, and the issuer is obligated to make quarterly contract payments onthe forward contract. An initial remarketing is scheduled to occur priorto the settlement date. For example, an initial remarketing is scheduledto occur three (3) months prior to the settlement date. That is, on orabout Nov. 15, 2003 a remarketing is scheduled to be performed to resetthe interest rate of the note to a rate that will allow the note to beresold or remarketed for an amount at least equal to the settlementamount of the forward contract. Further, in the illustrative example,the note is a 30-year non-convertible trust preferred note.

Based on (and referring to) this illustrative example, process 300 willnow be described. Process 300 begins at 302 where an initial remarketingwith a capped reset rate is attempted. In the example, the attemptedinitial remarketing with a capped reset rate occurs on or about Nov. 15,2003. The reset rate of the attempted initial remarketing is capped atthe issuer 30-year non-convertible trust preferred rate as of the dateof issuance (in the example, as of Feb. 15, 2001). If the attemptedinitial remarketing is successful, the process continues at 306 wherethe forward contract is settled with the proceeds from the remarketing.Any additional funds from the remarketing are disbursed to the holder(after any remarketing fees are paid).

If, however, the initial capped remarketing is unsuccessful, the processcontinues at 308 where settlement of the forward contract is delayed. Ifany contract payments are scheduled, the issuer will be required tocontinue to make these contract payments during the period of the delay.

Processing continues at 310 where one or more subsequent scheduledcapped remarketings are attempted. As a specific example, a unit may beissued which includes three scheduled capped remarketings, where theremarketings are scheduled to occur in years 3.25, 3.5, and 3.75. Foreach of these scheduled capped remarketings, the reset rate may becapped at a rate set at issuance of the unit. Continuing theillustrative example, the reset rate may be capped at the issuer 30-yearnon-convertible trust preferred rate as of Feb. 15, 2001.

If a subsequent scheduled capped remarketing is successful, processingcontinues to 314 where the forward contract is settled with the proceedsfrom the remarketing. Again, any additional funds from the remarketingare disbursed to the holder (after payment of any remarketing fees).

If a subsequent scheduled capped remarketing is unsuccessful, processingcontinues to 316 where a determination is made whether any furthercapped remarketings are scheduled. In the illustrative example, if thescheduled capped remarketing at year 3.25 is unsuccessful, theadditional scheduled capped remarketing at year 3.5 is attempted, and soon. During the period between scheduled capped remarketings, settlementof the forward contract is delayed and any contract payments owed arepaid by the issuer.

If no additional capped remarketings are scheduled, processing continuesto 318 where settlement of the forward contract is again delayed (andthe issuer, if required, continues to make any scheduled contractpayments). During this period, processing may continue to 320 where theissuer can elect to attempt an opportunistic remarketing. In someembodiments, the issuer may be permitted to attempt one or moreopportunistic remarketings any time after the initial scheduled cappedremarketing (e.g., in some embodiments, the opportunistic remarketingsmay be attempted any time after year three (3) or after theoriginally-scheduled settlement date). In some embodiments, theseopportunistic remarketings may be capped or uncapped (at the issuer'soption).

If any attempted opportunistic remarketing is successful, processingcontinues at 326 where the forward contract is settled using proceedsfrom the successful remarketing. Again, any additional funds from theremarketing are disbursed to the holder (after any remarketing fees arepaid).

If any attempted opportunistic remarketing is unsuccessful, processingcontinues at 328 where a final remarketing with an uncapped reset rateis attempted. This final remarketing, in some embodiments, is scheduledto occur after the last of the scheduled subsequent capped remarketings.In the illustrative example, the final remarketing with an uncappedreset rate is scheduled to occur shortly after the last cappedremarketing scheduled at year 3.75 (e.g., the final remarketing with anuncapped reset rate may be attempted at year 4).

If the final remarketing with an uncapped reset rate is successful,processing continues at 332 where the forward contract is settled withthe proceeds from the remarketing. Again, any additional funds from theremarketing are disbursed to the holder (after any remarketing fees arepaid). If, however, the final remarketing with an uncapped reset rate isunsuccessful, processing continues at 334 where the forward contract issettled by seizure of collateral (e.g., by seizure of the note componentof the unit).

In this manner, embodiments provide a remarketing period during which anumber of different attempts at remarketing a note portion of amandatory unit may be performed. More particularly, embodimentsinitially attempt capped remarketings. If the capped remarketings fail,an uncapped remarketing is attempted.

Pursuant to some embodiment, some or all of the processes of FIGS. 2 and3 may be performed using one or more computing devices. Similarly, anyof the participants (such as the issuer, the holder, or the agent) mayutilize one or more computing devices to evaluate, price, administer, ormanage units issued pursuant to embodiments described herein.

For example, referring now to FIG. 4, a computing device such as device400 may be utilized. In some embodiments, device 400 is operated by oneor more unit administrators acting to assist in, or direct the issuanceof units pursuant to embodiments disclosed herein. For example, in someembodiments, device 400 is operated by, or on behalf of, an issuer toprice and identify terms associated with the issuance of units. Asanother example, in some embodiments, device 400 may be operated by, oron behalf of, a remarketing agent to assist in the performance of one ormore remarketings pursuant to embodiments of the present invention. Asother examples, device 400 may be operated by, or on behalf of, aholder, an agent, or other participant in a transaction involving unitsas described herein.

As depicted, device 400 includes a computer processor 404 operativelycoupled to a communication device 402, a storage device 408, an inputdevice 406 and an output device 407. Communication device 402 may beused to facilitate communication with, for example, other devices andother participants (such as, for example, devices operated by holders,issuers, agents, market data providers, etc.)

Input device 406 may comprise, for example, one or more devices used toinput data and information, such as, for example: a keyboard, a keypad,a mouse or other pointing device, a microphone, knob or a switch, aninfra-red (IR) port, etc.

Output device 407 may comprise, for example, one or more devices used tooutput data and information, such as, for example: an IR port, a dockingstation, a display, a speaker, and/or a printer, etc.

Storage device 408 may comprise any appropriate information storagedevice, including combinations of magnetic storage devices (e.g.,magnetic tape and hard disk drives), optical storage devices, and/orsemiconductor memory devices such as Random Access Memory (RAM) devicesand Read Only Memory (ROM) devices.

Storage device 408 stores one or more programs 410 or rule sets forcontrolling processor 404. Processor 408 performs instructions ofprogram 410, and thereby operates in accordance with aspects of thepresent invention. In some embodiments, program 410 includes pricingrules used to evaluate or select terms associated with units issuedpursuant to embodiments described herein. In some embodiments, program410 includes rules used to identify the occurrence of events associatedwith units issued pursuant to the present invention (and to performadministration tasks relating to the occurrence of the events). In someembodiments, program 410 may be configured as a neural-network or othertype of program using techniques known to those skilled in the art toachieve the functionality described herein.

Storage device 408 also stores one or more databases, including, forexample, unit data 412, pricing and accounting data 414, etc. Thisinformation may be used, for example, to issue and/or administer unitspursuant to embodiments disclosed herein. For example, unit data 412 mayinclude information associated with the terms and conditions of unitsthat have been issued and may be used to monitor and administer theunits. Other data, programs, and rules may also be used in conjunctionwith embodiments disclosed herein.

Although the present invention has been described with respect to apreferred embodiment thereof, those skilled in the art will note thatvarious substitutions may be made to those embodiments described hereinwithout departing from the spirit and scope of the present invention.

1. A method for issuing a unit to a holder, comprising: creating aforward contract, the forward contract specifying a settlement amountand a settlement date; creating a note securing obligations of saidholder under said forward contract, said note specifying an initialcapped remarketing, at least a first subsequent capped remarketing, andan uncapped remarketing, said uncapped remarketing performed only ifeach of said capped remarketings fail, each of said capped and uncappedremarketings scheduled to occur prior to said settlement date; andissuing said forward contract and said note as a unit.
 2. The method ofclaim 1, wherein said note further specifies an opportunisticremarketing period during which an issuer of said unit has discretion toperform at least one of a capped and an uncapped remarketing.
 3. Themethod of claim 1, further comprising a second and a third subsequentcapped remarketing.
 4. The method of claim 1, wherein a remarketing issuccessful if said note can be resold for an amount greater than saidsettlement amount.
 5. The method of claim 1, wherein a remarketing issuccessful if said note can be resold for an amount greater than saidsettlement amount plus a remarketing fee.
 6. The method of claim 1,wherein an issuer of said unit is a financial institution obligated tomaintain Tier 1 and Tier 2 capital and wherein said unit is treated asTier 1 capital.
 7. A method for remarketing a mandatory unit: attemptingan initial capped remarketing of a note portion of said mandatory unit,said initial remarketing attempted prior to a settlement date of aforward contract portion of said mandatory unit, said initialremarketing subject to a reset rate cap; attempting a subsequent cappedremarketing if said initial remarketing is unsuccessful; and attempting,if both said initial capped remarketing and said subsequent cappedremarketings are unsuccessful, a final remarketing of said note portionof said mandatory unit, said final remarketing attempted prior to saidsettlement date and not subject to a reset rate cap.
 8. The method ofclaim 7, further comprising: attempting, prior to said attempting saidfinal remarketing, an opportunistic remarketing, said opportunisticremarketing performed at an option of an issuer of said mandatory unit.9. The method of claim 8, wherein said opportunistic remarketing is atleast one of a capped and an uncapped remarketing.
 10. The method ofclaim 7, further comprising: settling said forward contract portion ofsaid mandatory unit with proceeds from a successful remarketing.
 11. Themethod of claim 7, wherein a remarketing is successful if said note canbe resold for an amount greater than a settlement price associated withsaid forward contract.
 12. The method of claim 7, wherein a remarketingis successful if said note can be resold for an amount greater than asettlement price associated with said forward contract plus aremarketing fee.
 13. The method of claim 7, wherein said initialremarketing is scheduled to occur prior to said settlement date.
 14. Themethod of claim 13, wherein both said subsequent capped remarketing andsaid final remarketing are scheduled to occur prior to said settlementdate and after said initial remarketing.
 15. The method of claim 7,wherein if said subsequent capped remarketing is unsuccessful, a secondand a third subsequent capped remarketing are attempted.
 16. The methodof claim 7, further comprising: determining that each of said attemptedremarketings is unsuccessful; and settling said forward contract portionof said mandatory unit with a seizure of collateral of a holder of saidforward contract.
 17. A method for issuing a mandatory unit from anissuer to a holder, the method comprising: creating a forward contract,the forward contract having a contract term extending from an issue dateof said unit to a settlement date, said forward contract specifying ashare delivery ratio for calculating a share delivery of issuer stock tosaid holder at said settlement date in exchange for a settlement amount;creating a note securing obligations of said holder under said forwardcontract, said note specifying an initial capped remarketing, at least afirst subsequent capped remarketing, an opportunistic remarketingperiod, and an uncapped remarketing, said uncapped remarketing performedonly if each of said capped remarketings and any remarketings attemptedduring said opportunistic remarketing period fail; and issuing saidforward contract and said note as a unit.
 18. The method of claim 17,wherein said note is a contingent note.
 19. A unit administrationsystem, comprising: a processor; and a storage device in communicationwith said processor and storing instructions adapted to be executed bysaid processor to: administer an attempt of an initial cappedremarketing of a note portion of said mandatory unit, said initialremarketing attempted prior to a settlement date of a forward contractportion of said mandatory unit, said initial remarketing subject to areset rate cap; administer an attempt of a subsequent capped remarketingif said initial remarketing is unsuccessful; and administer an attempt,if both said initial capped remarketing and said subsequent cappedremarketings are unsuccessful, a final remarketing of said note portionof said mandatory unit, said final remarketing attempted prior to saidsettlement date and not subject to a reset rate cap.
 20. The unitadministration system of claim 20, further comprising a communicationdevice coupled to receive information from at least one of an issuer, aholder, a remarketing agent, and a market data source.
 21. A method forremarketing a mandatory unit: (a) attempting an initial cappedremarketing of a note portion of said mandatory unit, said initialremarketing attempted prior to a settlement date of a forward contractportion of said mandatory unit, said initial remarketing subject to areset rate cap; (b) attempting a subsequent capped remarketing if saidinitial remarketing is unsuccessful; and (c) attempting, if both saidinitial capped remarketing and said subsequent capped remarketings areunsuccessful, a final remarketing of said note portion of said mandatoryunit, said final remarketing attempted prior to said settlement date andnot subject to a reset rate cap; wherein at least some of said (a)-(c)are performed using a computer.